VERDICT FOR £1000.

New Zealand Herald, Volume LXII, Issue 19169, 7 November 1925, Page 13

VERDICT FOR £IOOO.

HAMILTON LIBEL ACTION. argument on legal points. CONSIDERATION POSTPONED. EVIDENCE FOR THE DEFENCE. The. hearing of the action in which John Ignatius Fox (Mr. Seymour and Mr. McGregor) claimed £SOOO damages for libel from William Goodfellow, managing director of the New Zealand Cooperative Dairy Company, Ltd. (Sir John Findlay and Mr. Northcroft), was continued in the Supreme Court yesterday, before Mr. Justice Herdman and a jury of 12. Sir John Findlay, in opening for the defence, characterised the action as one of the most extraordinary cases of defamation that had ever come before the Court in New Zealand, He had never known a case in which a man brought into Court his reputation, asked a jury to assess damages and shirked going into the witness-box to defend his character. In referring to the evidence for plaintiff. Sir John said that. Mr. Parker knew Mr. Ranstead to be a man of good repute. He would have been disposed to believe the statements made by Ranstead in the letter to Goodfellow had he not known Fox. Heading from the letter, counsel s.i.'d John Ignatius Fuchs—that was plaintiffs real name—was a Jew, who had worked for a silk merchant in Vienna. He went to London and turned Christian. Later he came to New Zealand, William Ranstead being a fellowpassenger. Plaintiff, who was known as Fox, came out as curate to the Vicar of ioxton, who repudiated him. Mr. Seymour, interjecting, said there were libellous statements in the letter that might be thp subject of further action. He desired to make the position clear to the press. Review of Fox's History. Sir JoJin Findlay said that Fox did some work among the flaxmill hands and subsequently went to Hamilton, where he met Ranstead and stayed with him. Later plaintiff married a rich widow at Foxton and went to England. He returned to New Zealand as a "Red Fed." and was associated wth Semple and others in the waterside strike in 1913. In 1914 Ranstead was in London and applied for enlistment in a force being organised by the High Commissioner for New Zealand. Ranstead saw Fox at the High Commissioner's office and asked him what he—an Austrian—was doing there. , Fox said he- was a naturalised British ' subject. He had been in Germany for the purpose of raising capital to- work some timber interests in New Zealand.. Ranstead reported Fox is a probable spy and was taken on and told to keep an eye on Fox. The letter also referred to Ranstead having again reported Fox on Gallipoli and stated that Fox was shipped back to New Zealand. Mr. Seymour: The defence has notpleaded justification. Sir John Findlay: We contend that we had reasonable ground for believing what we said to be true. He added that, strangely enough, plaintiff became secretary to the Wellington Returned Soldiers' Association. He could not sufficiently express his regret that Fox did not go into the witness box. Small Companies Advocated. Continuing to quote from the letter, Sir j John said Fox this year appeared in the j Waikato. He met Ranstead and discussed ! the position of the dairy farmers with | him. He advocated the establishment of a number of small dairy companies in place of the one large concern. Ranstead told him that- union was strength and related to him the history of the amalgamation of dairying interests in the district. Ranstead believed that Fox would do anything for money. Fox had renounced his religion: he had renounced his country, had been a " Red Fed " and was now a member of the Retorm Party. Ranstead firmly believed that Fox was a German spy and would have no dealings with him. Sir John again commented on the fact that plaintiff had refused to give evidence. Mr. Seymour: He did not refuse. You can call him. Sir John : If he had gone into the box and been cross-examined he would have left it with no character at all. The action, he said, was merely a phase of a bitter conflict that was being waged in the Waikato between rival dairying interests. The New Zealand Dairy Company had been built up on the most democratic principles possible. It- was a co-operative concern and had achieved immense success. This was largely due to the influence and ability of defendant. Preventing Absolute Control. Plaintiff had been retained to do the | work, that aimed to destroy the company j and to get Goodfellow ejected from his i office. It aimed to introduce the ward j system for the election of members of the Dairy Control Board and the disintegration of the company. Another object was the prevention of absolute control of the dairying output by the board. If the ward system of election were adopted it would give the proprietory interests a dominating influence on the Control Board in two ♦•lections. The New Zealand Dairy Company stood in the way. Fox was brought to take sides with the enemies of Goodfellow. There was a deeper question than whether plaintiff had been slandered or not. Could defendant allow himself and his company to be undermined by methods which were almost spy methods without, raising his hand in defence? Defendant had tested Fox by questions frcm Ranstead's letter. Goodfellow had put the question to Fox whether he was nnt twice reported as a spy. 1 hat was the only part of the letter that was contradicted by plaintiff. Defendant was entitled to believe the statements in the letter and as managing director of the company had a duty to perform in protecting his company and shareholders from attack. * None of the witnesses said defendant was actuated by malice. Three of them considered he was perfectly sincere and believed he had good authority for the statements he made. Sir John Findlay formally moved for a non-suit on the slander charges. His Honor reserved the point for legal argument. Mr. Ranstead's Motives. William Ranstead, of Raglan, a retired farmer, said he was the author of a letter produced. It had been addressed to Goodfellow, and he had dictated it to his son. He had sent it because Goodfellow was a friend of 20 years' standing, and as witness' sons were farmers he was interested in the welfare of Goodfellow's company- . , In reply to Mr. Seymour witness said his views* might have" been expressed in an extreme form, but the facts were there. He knew that Fox's activities were prejudicial to the-company, and were specially directed against Goodfellow. He felt it his duty to let Goodfellow know the character of the man who was attacking him. His Honor: Were you seeking to protect Goodfellow or the company? Witness: The company. Mr. Seymour asked witness whether he realised the scurrilous nature of the letter. , , , Sir John Findlay protested, and the Judge upheld his objection. Defendant was then ca'ied. He stated he had been associated with the New Zealand Co-onerative Dairy Company for 17 years. The company's business had been built up largely through his efforts. It now produced about 25 per cent, of the butter-fat exported from New Zealand. He was a member of tho Dairy Produce Control Board. The board had decided to bring in absolute control of dairy produce

exports from August 1, .1926. This decision was being strongly opposed by the private exporting interests, which stood to lose about £luo.oou a year in commissions when the board assumed tho full control of exports. Opposition also camo from the proprietory factories. His company, owing to its size, was a distinct obstacle to the opponents of absolute control, They had therefore attacked the company by advocating the, ward system of electing members to the Control Board. If they could secure the return of ward members pledged against absolute, control it might be possible to avert the introduction of the latter. He agreed with Mr. Seymour's description of the dispute as "open war." The attack'had been not only against absolute control, but also against his company, with the object of disintegrating it. and against himself. For some time past the Waikato had been the principal fighting ground. About half way through tho campaign he heard of the arrival of Fox, who, ho learned, had interviewed Mr. Fulton, chairman of directors, Mr. Bruce, one of the directors, and Mr. Cuming, editor of the Dairy Farmer, the company's official organ. To each of these Fox made the same suggestion, namely, that it would be much better if the dairy industry of the Waikato were carried on by a number I of small companies instead of by one large j one. Mr. Fulton ridiculed tho idea, and i asked how the company's box factory and coalmine were to be carried on. Fox replied that a federation of small companies could control them. Evidently ho j had a c.learlv-conceived plan in mind. An Interview With Fox. ; Later, Mr. Jack Ranstead, a supplier, i called on him, and in an interview told ! him that Fox was not in the Waikato for any good purpose. Witness asked him to obtain further facts, and he obtained a statement dictated over the telephone by his father, Mr. William Ranstead. After he had read it, Mr. Jack Ranstead ! told him that his father was prepared j to substantiate it if necessary in the wit-ness-box. He continued his inquiries about Fox and in due course Fox asked him for an interview. He agreed, intending to find out what Fox's plan of campaign was, and particularly what were his designs against the company. He knew that Fox was similarly out to obtain information. His Honor: I suppose you will concede that Fox had a perfect right to do what he did. Witness: I realise he had a perfect right to organise against me. ?dr. Northcroft : And you had a perfect right to organise against him. Witness went on to say that Fox at the interview "spread himself" with the | object of creating a good impression. lie ! stated that he was now organiser for the j Dairy Farmers' Union and suggested that ! he and witness should work together for | the good of the farmers. He admitted I that he was in favour of the ward svs- ! tem. Questions Regarding Spying. They discussed proposals for a comproj mise, especially as there seemed to be a ! division of opinion in the ranks ot the j Dairy Farmers' Union on the control issueAfter careful consideration he arranged j a second interview with Fox with the inj tention of telling the latter all that was in I his mind. At the second interview he told Fox that he was not prepared to take him at his face value. The record of the Dairy Farmers' Union was not satisfactory, and in view of certain information which he had received there was no possibility whatever that he and Foxcould work together. The union would have io justify itself before it could expect any support from him or his enmpany. He asked Fox a direct question whether he had not been twice reported as a spy. j Fox asked " Do you make that statej ment ?" Witness replied, "No, I am askj ing a question." Fox denied that there j was any truth in it. He then told Fox I frankly that he had come to the conclusion that he was unreliable, and that he could expect no support from witness or the company. Subsequently he communicated with Messrs. McKinney and Parker, who were officials of his company and of the union. This was in view of the coming Dominion conference of the union, which was to be held at The union at Pal- ! merston North supported the ward system, I and he expected that a strong contingent t would ue sent from Palmerston North | to influence Waikato members in that j direction. He showed Mr. Ranstead's j letter to Mr. Parker, who danced over | it and said he did not think the statej merits were true. Statements Confidential. | Witness admitted lie had made state- | merits about Fox at the inquiry into Mr. Sinclair's allegations against the eom- ! pany. He made them believing that j they would be regarded as strictly confidential. Mr. Seymour, opening his cross-ex-amination, remarked that the statement of defence did not plead that the statements about Fox were true. He asked witness whether he believed them to be true or false. The Witness: I can say without fear of contradiction that I believe the statements in Mr. Ranstead's letter to be strictly correct. Witness said that he had repeated the plain statements in Mr. Ranstead's ietter to a limited number of friends because he felt it his duty to protect his company. He made no statement on his own account. When he wrote to Mr. McKinney. conveying Mr. Ranstead's statement, he had marked the letter " private and confidential. " Mr. Seymour produced some papers, which lie stated were military papers, and asked witness whether, after seeing them, he would have sent on the allegations contained in Mr. Ranstead's letter.,. Sir John Find lay objected that Mr. Seymour was trying to bring in the papers as evidence to prove the innocence of his client. Mr. Seymour submitted that if, after ! perusing the papers in Court, Goodfellow j still said he would have communicated Mr. Ranstead's letter to others, then it would be clear that lie had acted in malice. Sir John Findlay: 1 am prepared to i show that the papers were obtained by fraud. I would have if the plaintiff had ' gone into the box, but he did not. Mr. Seyrhour took exception to a later remark by witness that Fox had invaded J " our territory." Witness said the term j was commonly used to indicate the area j from which a dairy company drew its sup- ] plies. It meant nothing more. Spy Service Denied. Mr. Seymour: I.s it not a fact that you have, an elaborate system of spying yourself ? The Witness: No. I have not. Have you not been in this spying busi ness for a considerable time?— No. It is an absolutely unjustified remark. Mr, Seymour caused many protests and much argument by attempting to obtain answers irom the witness about a certain dispute with Joseph Nathan and Company, Limited, who had issued a writ for alleged libel. In answer to the Judge, he explained that his questions were intended to test the witness' character and veracity. Witness said the dispute wa^over butter prices and consignments. There was an exchange of writs, and the whole matter was settled out of Court, each party paying its, own costs. Counsel suggested that in the course of the dispute witness had arranged with a man named Mulheron to set a trap for a man named Sandycroft, who was concerned in the dispute. The Witness: I did, and he fell into it, too. Mr. Seymour: You admit that. Witness: It settled the case. There was no spying. He approached Mulheron and offered him a bribe. It was only after he had done so that we set a trap for him. Counsel pursued the same line of argument, and asked witness whether he had been in " the blackmail game." His Honor: I object to the question in that form. Blackmail is a crime. It is a most improper question. Mr. Seymour (to the witness): I take it you hotly deny any suggestion of blackmail ? Witness: Yes. It is a ridiculous suggestion. Mr. Seymour asked witness whether he had not despatched Mulheron to Pukekohe to gain the confidence of a girl and obtain

from her certain papers hearing on a dispute with Sinclair, a former managor for the company. Witness replied that the allegation was untrue. The papers had been given voluntarily to Mulheron. Mulheron had been employed by the company as a dairy instructor, and an allegation that he had been paid £SO a week as a spy had been disproved at the inquiry into Sinclair's allegations. John Robert Fow, Mayor of Hamilton, and one of the tribunal which inquired into Sinclair's charges, said that Goodfellow, so far as he recollected, did not say that Fox, if he had been served right, would have been shot twice as a spy. He did say that Fox had been twice reported as a spy. This was in answer to a question by witness. Dynes Fulton, farmer, of Tuakau, and chairman of directors of the New Zealand Co-operative Dairy Company, and David Bruce, farmer, of Hamilton, a director of the company, stated that Fox had propounded to them a scheme for setting ii]) snmll companies. They deuied that they had gone in search of Fox, and said the latter had been anxious to meet them. Charles Edward Cuming, editor of the Dairy Farmer, gave similar evidence. In summing up, His Honor invited the jury to find for defendant on one cause of action, relating to an alleged statement to Parke- that Fox was in the employ of proprietary concerns. He remarked that the evidence in support of it was insufficient, and thee was doubt whether, if made, the statement was defamatory. If the jury had to consider damages, they would probably conclude that the £SOOO claimed was excessive. They must consider plaintiff's station in life in deciding what sum, if any, should be awarded. Tho Jury's Findings. The following were the issues submitted to tho jury by Mr. Justice Herdman, together with the answers returned : Did defendant on or about July 14, 1925, referring to plaintiff's period of war service, say to Charles Parker concerning the plaintiff the following: "Have you ever heard that Fox was reported twice as a spy." meaning thereby that plaintiff was of a base and traitorous character and had committed a serious crime ?—The answer was in the affirmative, the damages on this issue being assessed at £3OO. Did defendant, on or about the date aforesaid, speak and publish to Parker or plaintiff in his capacity as organiser of the Dairy Farmers' Union, the following words: "I have reason to believe that Fox is here in the employ of the proprietary concerns. I'll tell you who—it is Nathans," meaning thereby that plaintiff was base, fraudulent and untrustworthy and unfit to be employed by the Dairy Farmers' Union ?—No answer. Did the defendant, on or about the date aforesaid, publish to Parker of the plaintiff, in reference to his war service, a writing containing words to the following effect: "William Ranstead reported Fox to the authorities as a probable spy. A very clumsy policeman was put on to shadow Fox. who suddenly became very careful and did not give himself away. William R next, met Fox at Gallipoli, where Fox was engaged as a cook at headquarters. This was a position where he could get a lot of useful information. William R. reported him again, with the result that he was shipped back to New Zealand," meaning that plaintiff was a base and traitorous character and had committed a crime? —Yes. Damages on this issue were assessed at £350. Did defendant on or about July 2, 1925, speak and publish to J. G. Wynvard the following words:—"lf Fox had his rights he would have been shot twice as a spy," this statement having reference to plaintiff's war service? —No. Did the defendant on or about July 14, 1925, publish to John B. McKinney in reference to the war service of plaintiff a writing containing the following words: " William Ranstead reported Fox to the authorities as a probable spy. A very clumsy policeman was put on to shadow Fox, who suddenly became very careful and did not give himself away. William R. next met Fox at Gallipoli where Fox was engaged as a cook at headquarters. This was a position where he. could get a lot of useful information. William R. reported him again, with the result that he was shipped back to New Zealand," meaning thereby that plaintiff was a base and traitorous character and had committed a crime? —Yes. Damages were assessed at £350. Two Answers by Majority. If tho answer returned to any of the foregoing questions is " Yes " then: Did defendant publish the matter complained of in pursuance of his duty to the New Zealand Co-operative Dairy Company, Limited, and in the bona-fide belief of the. truth thereof and with an honest desire to protect members and creditors of the company and to persons who had an interest oi duty corresponding to that of the defendant to receive it and is it a fact that it was not published to anyone without such interest and duty ?—No, by majority of 10 to 2. Did he publish the matter complained of maliciously ?—Yes, by a majority of 10 to 2. What damages (if anvj is plaintiff entitled to recover ?—£looo. The jury retired shortly after six o'clock and after having dinner returned to the Court to consider the verdict. At ten o'clock they returned to the courtroom and asked that ceitain portions of the evidence relating to the allegations should be read to tnem for the purpose of refreshing their memories. When this had been done by His Honor they again retired, returning with the verdict at 11.10 p.m. Counsel for plaintiff, Mr. D. Seymour, formally moved that judgment be entered in accordance with the jury's verdict. Mr. E. 11. Northcroft said" that Sir John Findlay, leading counsel for defendant, had several points to raise and he therefore asked that all points be reserved. The case was accordingly adjourned for further consideration.